Tax credits threat to families - claim

GLENROTHES’ MP has expressed serious concern at the impact changes to tax credits will have on more than one thousand people in his constituency when they come into force.

Figures obtained by Lindsay Roy show that 280 families with 545 children – 1105 people in total – face losing working tax credit worth £3,870 unless they increase their working hours to 24 a week.

He said: “At the moment, couples with children have to work at least 16 hours a week between them to qualify for credit, but next month that changes to 24 hours.

‘’If they can’t up their hours - and that will be exceedingly difficult in the current economic climate - they will lose their whole entitlement to the credit, worth £3,870 a year.

‘’Just how difficult it will be to find extra work has been amply illustrated by the Union of Shop, Distributive and Allied Workers, who say that 78 per cent of their members won’t be able to get extra hours.’’

The new rules will last until October, 2013 when Universal Credit is introduced, but Mr Roy fears many families will be forced in to real poverty in the meantime.

He added: “A typical household with two children where a couple works between 16 and 24 hours a week has total income, including wages, tax credits and benefits, of around £17,000 a year. That in itself places them in or on the threshold of poverty, but if they then lost £3,870 in credit because they can’t find extra work, then they will face extreme hardship. Indeed, according to research carried out by Usdaw, many families would be better off not working at all - so much for the Government’s commitment to make work pay, a commitment that I endorse fully. This change demonstrates a heartless and uncaring approach by the coalition Government who are penalising working families doing their best to survive during this difficult financial time.

‘’Worse still, this group of people are being asked to contribute disproportionately to a massive deficit for which they were not responsible. Extending working hours and cutting back tax credits show just how out of touch David Cameron and Co are with ordinary working people. It is not too late for the policy to be reversed or at least postponed until the economy picks up.”